Exploring factors impacting e-commerce adoption in tourism industry in Saudi Arabia

Abstract

With the internet revolutionising global tourism, technological changes continue to make inroads into the industry’s marketing and sales management models. Although many tourists still use shopfront providers, they are increasingly becoming a minority as the ‘mobile generation’ goes online for information and uses social media to discuss their holiday plans and book travel services. In Saudi Arabia, the religious tourism industry serving Hajj and Umrah pilgrims as well as other tourism clusters have been slow in coming to terms with e-commerce trends, preferring to offer a traditional personalised service to their clients. However, the logistical needs of servicing the rapidly increasing numbers of international pilgrims and growing IT literacy in the local market means that tourism management in Saudi Arabia needs to make considerable investments in time, resources and training to harness information technology and adopt business models that are at par with their global competitors. To respond to this issue, this study explores the perceptions and experiences of executives in the Hajj/Umrah as well as other tourism industry sectors to understand the factors that may have fostered or impeded e-commerce adoption. This research contributes to the existing research on e-commerce adoption in Saudi Arabia by providing an explanation of the factors that influence the adoption of e-commerce by the tourism industry and explaining how generic theories of technology adoption need to be contextualised for the specific conditions prevailing in the Arab tourism market. The practical contribution on this research relates to the solutions it offers for the challenges faced by the travel and tourism industry in e-commerce adoption in Saudi Arabia. The research was conducted using interviews with Saudi tourism executives to understand the contextual factors that influence the norms and attitudes prevailing in the tourism business that affect their adoption of e-commerce. This was followed by a questionnaire which was sent to a larger sample in Saudi cities, mainly focussing on Jeddah. The questionnaire focused on uncovering the factors influencing the adoption, or lack thereof, of e-commerce in the Saudi tourism industry. The research was grounded on a theoretical framework derived from the Unified Theory of Acceptance and Use of Technology, Perceived Organisational and External E-Readiness scales, and Organisational Cultural Dimensions. The findings confirmed that the perceived relative advantage of e-commerce utilisation was an essential contributor to promote e-commerce in Saudi Arabia. Although government policy and industry norms were shown to influence e-commerce adoption, executives’ attitudes were found to strongly affect technology adoption and were shown to be indirectly modified by their ICT literacy and customer influence. Internal human and ICT resources also had a direct impact on the decision to adopt e-commerce. On the other hand, customers’ attitude relating to issues regarding online privacy and security and a lack of human interaction in a market with a preference for personalised agent service for customers form significant barriers to their adoption of e-commerce. There is also a lack of industry leadership and a supportive Saudi-based IT industry that can facilitate this move toward modernisation in industry standards. While there is a broad understanding of the importance of e-commerce, the tourism providers view an e-commerce strategy as not yet necessary, or indeed not yet relevant, for the tourism industry in Saudi Arabia at this time.

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